The Metropolitan Corporate Counsel Interview: The Last Word on Disclosure of Projections Under Delaware Law

Michael B. Tumas, Michael K. Reilly

June 10, 2008

"Over the past year the Delaware Court of Chancery has issued three decisions and one bench ruling on whether certain types of information, particularly financial projections, are material and thus must be disclosed to the shareholders. As an initial matter, it should be noted that under Delaware law information is material if there is a substantial likelihood that a reasonable shareholder would consider it important in deciding how to vote. These four rulings, Netsmart, CheckFree, Globis Partners and BEA Systems, indicate that a context-specific analysis, and not a single legal standard, is necessary to determine whether projections are material in a specific case under Delaware law."